SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D. C.

             FORM 10-K (AMENDED 6 JANUARY 1997 AND 26 FEBRUARY 1997)

                    ANNUAL REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934



FOR FISCAL YEAR ENDED:  JUNE 30, 1996       COMMISSION FILE NO. 0-4076
                       --------------                           ------


                              EXOTECH INCORPORATED
               (Exact name of Registrant as Specified in Charter)


State or Jurisdiction of
 Incorporation or Organization:                      DELAWARE

IRS Identification No:                               54-0700888

Address of Principal Office:                         8502 Dakota Drive
                                                     Gaithersburg, MD. 20877

Registrant's Telephone Number:                       (301) 948-3060

                        SECURITIES REGISTERED PURSUANT TO
                       SECTION 12 (b) OF THE EXCHANGE ACT

                                      None

                        SECURITIES REGISTERED PURSUANT TO
                            SECTION 12 (g) OF THE ACT

                     Common Stock par value $0.10 per share.

Indicate by checkmark  whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirement for the past 90 days.
                                            Yes [x]             No      [  ]

At June 30,  1996,  942,387  shares of Common  Stock were  outstanding,  and the
aggregate market value of the Common Stock of Exotech Inc. held by nonaffiliates
was approximately $56,750.

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      NONE

                                       B-1

<PAGE>



ITEM 7.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULT OF OPERATIONS.

         The Company's  revenues of $367,259 were 1.0% lower than in fiscal year
1995,  and 16% lower than in fiscal  year 1994.  The  declines  over these years
related in part to  organizational  and personnel  disruptions  in the Company's
principal  customer and marketing agent for  biotechnology  instruments,  Spiral
Biotech,  Inc.,  and  the  sub-par  quality  of  an  imported  automated  plater
instrument, sold as a part of a system including Exotech products. The Company's
new product has replaced this instrument. The $43,365 billed in fiscal year 1994
proved uncollectible and was written off in the following year.

         Sales  of  platers,   laser  bacterial   colony  counters  and  related
biotechnology  products  increased to $302,700  compared to $189,280 in 1995 and
$220,402  in  1994.  There  were no sales of  radiometers  nor  Crystallographic
Scanners,  although  radiometer  sales were $16,440 and $30,363  respectively in
1995 and 1994. Service and parts sales for Modulation  Transfer Function Testers
were  $17,350  compared  to $9,000 and  $57,000  respectively  in 1995 and 1994.
Service  and  maintenance   sales  for  the  broad  range  of  other  laboratory
instruments was down to $47,584  compared to sales of $147,257 in the prior year
and  $85,700 in fiscal  1994.  The higher  sales of service in fiscal  year 1995
resulted from repairs to the imported plater instrument mentioned above.

         The cost of operations,  including $129,000 of research and development
costs,  resulted in an operating loss of $127,367 compared to a profit of $2,057
in fiscal year 1995 and a loss of $8,812 in 1994.  The impact of interest  costs
resulted in a net loss of $152,584  compared to losses of $68,130 and $35,448 in
1995 and 1994, respectively.

         A net increase in demand notes of $60,501 needed to sustain development
of a new automated plater  instrument  caused an increase in interest expense to
$29,817  compared to $26,822 in the prior year,  and $27,752 in fiscal  1994.  A
charge of $129,000 was incurred in the past year for research and development to
search out the  combination of electronic and  mechanical  technology  needed to
design and develop a state-of-the-art  instrument with strong sales potential in
a highly  competitive  market. In the opinion of Management,  that objective was
achieved through intense effort to deliver two  preproduction  prototypes and 14
units of the new instrument in the second quarter of fiscal 1996.

         In  the  third  and  fourth  quarter  of  the  past  year,  orders  for
instruments and services were increased by Spiral Biotech,  Inc.  bringing sales
to about the level of the prior year and increasing  backlog to $279,000 at June
30, 1996,  compared to $81,000 one year earlier and $45,300 at the end of fiscal
year 1994. In the opinion of Management, recent improvements in the marketing of
the   biotechnology   products  will  rejuvenate  sales  of  the  laser  scanner
instruments together with increasing sales of the new automated plater.

         Despite  financial  limitations  that  have  impeded  marketing  of the
Crystallographic  Scanner  instruments,  management believes that the results of
on-going  collaborative  studies and demonstrations of capabilities will improve
the prospects of sales to the potential  customers who continue to show interest
in that instrument system.  Furthermore,  management is committed to explore the
prospects for collaborative arrangements with several well established suppliers
of manufacturing  equipment to the semiconductor producer industry as a means to
generate increased exposure and sales potential for this product.

     Over the past  three  fiscal  years,  as in prior  years,  the  independent
accountants' report has

                                       B-2

<PAGE>



included an explanatory paragraph,  following the opinion paragraph,  describing
the  existence of a going  concern  uncertainty.  The  accountants  have advised
Management  that the principal  cause for the going concern  uncertainty is cash
flow shortages which have caused delays in meeting current  obligations.  In the
opinion of Management,  the past three years of seriously  depressed markets for
the  Company's  products  caused  substantial   impediments  to  overcoming  the
qualification  stated by the accountants.  Continued  stringent control of costs
and cash  outlays has enabled  the  Company to sustain  high  quality and timely
upgrades of its products while nurturing improved results from marketing efforts
in a very  competitive  environment.  With a new product now experiencing a good
level of acceptance in the market,  and growth in the Company's  backlog for its
other  biotechnology-related   products,  Management  believes  that  increasing
revenue will provide  sufficient cash to support  operations  throughout  fiscal
year 1997. Additionally,  the opportunity to build on the results of our current
activity will be pursued to  reactivate  sales of the  Crystallographic  Scanner
instruments and technology.

         As shown in the Statements Of Cash Flows for the three years ended June
30 of 1996, 1995 and 1994, each period ended with a small positive cash balance.
The result of operating  net losses in 1996 and 1994 caused  negative  cash flow
from operating transactions of ($60,428) and ($35,805) respectively.  Offsetting
in these  cases  were net  proceeds  from  notes of  $60,501 in 1996 and in 1994
$33,500 plus a return of deposited funds in the amount of $1,334,  which limited
the decrease in cash flow to ($971).  In fiscal year 1995,  $26,439 was provided
by operating transactions.  That amount was offset by a net pay down of notes of
($26,903)  and  purchase of  equipment  of ($587)  causing a decrease in cash of
($1,051).  The Company continues to meet its cash flow obligations,  although at
times  delayed in some cases of trade  payables and payroll,  with receipts from
sales and financing  activities  comprised of loans from the Company's President
and from Spiral  Biotech,  Inc., its principal  customer.  The loans from Spiral
Biotech are secured by ordered  instruments  in progress and range from 30 to 40
percent  of the  purchase  order  value  for the  total  order.  No loans are in
default.   The  fluctuations  in  accounts  payable  relate  to  the  amount  of
work-in-progress for products on order.

         It is noted that the Company's property, plant and equipment are nearly
fully depreciated.  However,  all essential items of these assets are maintained
in good repair and no  replacements  nor additions are  anticipated  in the next
year or more.

The   Company's   management   and   employees   continue  to  be  committed  to
reestablishing progress toward our goal of profitability.

                                       B-3

<PAGE>



Linton, Shafer & Company, P.A.
Certified Public Accountants
6 West Second Street
Frederick, MD  21701
301-663-5122
Principals: Edmond B. Gregory III, CPA, CBA
Kevin R. Hessler, CPA
Donald C. Linton, CPA, CFP
Joseph M. McCathran, CPA
Ronald W. Shafer, CPA

               Report of Independent Certified Public Accountants


Board of Directors and Shareholders
Exotech, Incorporated


         We have audited the accompanying  consolidated financial statements and
related schedules of Exotech,  Incorporated and Subsidiary  included on pages 11
through  20 of the  annual  report on Form 10- K of  Exotech,  Incorporated  and
Subsidiary  as of June 30, 1996 and 1995 and for the years ended June 30,  1996,
1995  and  1994.  These  financial  statements  and  related  schedules  are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements and related schedules based on our audits.

         We conducted our audits in accordance with generally  accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable  assurance about whether the financial  statements and per share data
and ratios are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

         In our opinion,  the  financial  statements  referred to above  present
fairly,  in all  material  respects,  the  consolidated  financial  position  of
Exotech,  Incorporated  and  Subsidiary  as of June  30,  1996  and 1995 and the
results of their  operations  and their cash flows for the years  ended June 30,
1996,  1995  and  1994,  in  conformity  with  generally   accepted   accounting
principles.




                                       B-4

<PAGE>




         The accompanying  consolidated  financial statements have been prepared
assuming the Company will continue as a going concern. As shown in the financial
statements,  the Company  incurred a net loss of $152,584  during the year ended
June 30,  1996.  This fact,  among others  discussed in Note 1 to the  financial
statements,  raises substantial doubt about the Company's ability to continue as
a going concern.  The financial  statements do not include any adjustments  that
might result from the outcome of this uncertainty.


                                         /s/ Linton, Shafer & Company, P.A.



September 20, 1996




                                       B-5

<PAGE>



Linton, Shafer & Company, P.A.
Certified Public Accountants
6 West Second Street
Frederick, MD  21701
301-663-5122

Principals: Edmond B. Gregory III, CPA, CBA
Kevin R. Hessler, CPA
Donald C. Linton, CPA, CFP
Joseph M. McCathran, CPA
Ronald W. Shafer, CPA


                     Consent of Certified Public Accountants


We have issued our report dated September 20, 1996,  accompanying  the financial
statements and schedules of Exotech,  Incorporated  and Subsidiary  contained in
the annual  report on Form 10-K of Exotech,  Incorporated  and  Subsidiary as of
June 30, 1996 and 1995, and for the years ended June 30, 1996, 1995 and 1994. We
consent to the use of the aforementioned  report in the amendments to Form 10-K,
as amended January 6, 1997 and February 26, 1997.


                                         /s/ Linton, Shafer & Company, P.A.

February 26, 1997

                                       B-6

<PAGE>



                       EXOTECH INCORPORATED AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                        FOR THE THREE YEARS ENDED JUNE 30

         Reference is made to Note 1 of the Notes to the Consolidated  Financial
Statements  for a  description  of operations of the Company and to Note 2 for a
description of the principal accounting policies followed by the Company.

<TABLE>
<CAPTION>

                                                          1996                      1995                     1994
                                                          ----                      ----                     ----
<S> <C>
REVENUES
  Instrument Sales                                    $302,325                  $213,845                 $251,265
  Parts, Repairs and Services                           64,934                   156,257                  142,700
  Prior Fiscal Year Services                                --                        --                   43,365
                                                     ---------                 ---------                 --------
TOTAL SALES                                           $367,259                  $370,102                 $437,330

COST OF OPERATIONS
Direct Cost and Overhead
  Instrument Sales                                    287,536                   180,600                  243,562
  Repairs, Parts and Service                           56,162                   137,366                  140,414
  R & D Costs                                         121,263                        --                       --

General and Administrative
  Instrument Sales                                     18,345                     28,444                  39,433
  Repairs, Parts and Service                            3,583                     21,635                  22,733
  R & D Costs                                           7,737                         --                      --
                                                      --------                   -------                 -------

TOTAL COST OF OPERATIONS                              494,626                    368,045                 446,142
                                                      --------                   -------                 -------

OPERATING PROFIT (LOSS)                              (127,367)                     2,057                  (8,812)
-----------------------

OTHER REVENUES
 (EXPENSES)
Miscellaneous                                           4,600                   (43,365)                   1,116
Interest                                              (29,817)                  (26,822)                 (27,752)
                                                      --------                  --------                 --------

NET LOSS BEFORE TAXES                                (152,584)                  (68,130)                 (35,448)
---------------------

INCOME TAXES                                               --                        --                       --
                                                     ---------                 ---------                --------


NET LOSS                                            $(152,584)                 $(68,130)                $(35,448)
--------                                            ==========                 =========                =========

Loss per Common Share                                    (.16)                     (.07)                    (.04)

Weighted average number of
common shares outstanding                              942,387                   942,387                  942,387

</TABLE>

The accompanying notes are an integral part of these statements.

                                       B-7

<PAGE>



                       EXOTECH INCORPORATED AND SUBSIDIARY
                    CONSOLIDATED BALANCE SHEETS AS OF JUNE 30

<TABLE>
<CAPTION>


                                                                   1996                      1995
                                                                   ----                      ----
<S> <C>
CURRENT ASSETS

Cash                                                               $105                       $32

Accounts Receivable
(Note 2) Billed                                                  11,073                    54,300
Less: Allowance for Doubtful Account                                 --                  (43,368)

Inventories, at lower of
average cost or market
(Note 2)                                                        551,687                   575,450

Prepaid Expenses and Advances                                       344                     1,394
                                                                 ------                   -------

CURRENT ASSETS                                                  563,209                   587,808

PROPERTY, PLANT AND EQUIPMENT, at cost (Note 2)

Laboratory Equipment                                            160,980                   160,980
Office Furniture & Equipment                                     70,550                    70,550
                                                                 ------                  --------
                                                                231,530                   231,530

Less accumulated
 depreciation and
 amortization                                                 (231,119)                 (230,946)
                                                              ---------                 ---------

Total Property, Plant and Equipment - Net                           411                       584

OTHER ASSETS

Miscellaneous                                                     6,921                     7,849
                                                                  -----                     -----

TOTAL ASSETS                                                   $570,541                  $596,241
                                                               --------                  --------
</TABLE>

The accompanying Notes are an integral part of these statements.


                                       B-8

<PAGE>



                       EXOTECH INCORPORATED AND SUBSIDIARY
                    CONSOLIDATED BALANCE SHEETS AS OF JUNE 30


<TABLE>
<CAPTION>

                                                          1996                      1995
                                                          ----                      ----
<S> <C>
CURRENT LIABILITIES

Notes Payable and Current
 Maturities of Long Term
 Debt (Note 5)                                        $372,294                  $311,793

Accounts Payable and Other
 Accrued Liabilities                                   105,664                    51,996
Accrued Payroll and Employee
 Benefits                                               67,180                    46,845
Accrued Officer Salary and
 Benefits                                              201,510                   212,285
Accrued Interest                                        79,304                    76,149
                                                        ------                    ------

Current Liabilities                                    825,952                   699,068

SHAREHOLDERS' DEFICIT

Common Stock, par value $.10
 per share; 1,500,000 shares
 authorized; 970,135 shares
 issued and outstanding                                97,014                    97,014

Paid in Surplus                                     1,169,645                 1,169,645
Accumulated Deficit                                (1,409,650)               (1,257,066)
Treasury Stock 27,748 shares
 at cost                                             (112,420)                 (112,420)
                                                     ---------                 ---------
                                                     (255,411)                 (102,827)
                                                     ---------                 ---------

Total Liabilities and
 Shareholders Deficit                                 $570,541                  $596,241
                                                      ========                  ========
</TABLE>

The accompanying Notes are an integral part of these statements.


                                       B-9

<PAGE>



                       EXOTECH INCORPORATED AND SUBSIDIARY
         CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' INVESTMENT
                     FOR THE THREE YEARS ENDED JUNE 30, 1996

<TABLE>
<CAPTION>


                                   Common Stock                                               Treasury Stock 
                                      ($0.10)              Paid-In       Accumulated          ----------------          
                                     Par Value             Surplus        (Deficit)          Shares   Cost
<S> <C>
Balance, June 30, 1993          970,135     $97,014     $1,169,645      $(1,153,488)       27,748     $(112,420)
Add (Deduct)                    -           -           -               -                  -          -
Net Profit (Loss)               -           -           -                   (35,448)       -          -
                                ----------  ----------  -------------   -------------      --------   ----------

Balance, June 30, 1994          970,135     $97,014     $1,169,645      $(1,188,936)       27,748     $(112,420)
Add (Deduct)                    -           -           -               -                  -          -
Net Profit (Loss)               -           -           -                   (68,130)       -          -
                                ----------  ----------  -------------   -------------      --------   ----------

Balance, June 30, 1995          970,135     $97,014     $1,169,645      $(1,257,066)       27,748     $(112,420)
Add (Deduct)                    -           -           -               -                  -          -
Net Profit (Loss)               -           -           -                  (152,584)       -          -
                                ----------  ----------  -------------   -------------      --------   ----------

Balance June 30, 1996           970,135     $97,014     $1,169,645      $(1,409,650)       27,748     $(112,420)
                                =======     =======     ==========      ============       ======     ==========
</TABLE>

The accompanying notes are an integral part of these statements.

                                      B-10
<PAGE>



                       EXOTECH INCORPORATED AND SUBSIDIARY
           STATEMENTS OF CASH FLOWS FOR THE THREE YEARS ENDED JUNE 30

<TABLE>
<CAPTION>


INCREASE (DECREASE) IN CASH                                                  1996              1995               1994
---------------------------                                                  ----              ----               ----
<S> <C>
CASH FLOWS FROM OPERATING TRANSACTIONS
Net Loss:                                                                 $(152,584)       $(68,130)           $(35,448)
     Add: Non Cash Income Determinants
     Depreciation & Amortization                                              1,101           2,454               3,809
     Add (Deduct): Changes in Current Assets and Liabilities:
     (Increase) Decrease in Accounts Receivable                                (141)         83,447             (44,579)
     (Increase) Decrease in Prepaid Expenses                                  1,050            (572)                 29
     (Increase) Decrease in Inventory                                        23,764         (27,899)             (3,176)
     Increase (Decrease) in Accounts Payable                                 53,667          (4,484)            (10,613)
     Increase (Decrease) in Accrued Payroll & Related                         9,560          15,176              30,314
     Increase (Decrease) in Accrued Interest                                  3,155          26,447              23,859
                                                                              ------         -------             ------
Cash Provided By (or) Used In Operating Transactions                       $(60,428)        $26,439            $(35,805)
     -----------      -------                                              ---------        --------           ---------

CASH FLOWS FROM FINANCING TRANSACTIONS:
Proceeds from Notes                                                          87,500           4,000              55,000
Payment on Notes                                                            (26,999)        (30,903)            (21,500)
                                                                            --------        --------            --------
Cash Provided By (or) Used In Financing Transactions                         60,501         (26,903)             33,500
     -----------      -------                                                -------        --------             ------

CASH FLOWS FROM INVESTING TRANSACTIONS:
Purchase of Equipment                                                             --           (587)              1,334
                                                                             -------           -----            -------
Cash Provided By (or) Used In Investing Transactions                              --           (587)              1,334
     -----------      -------                                                -------           -----            -------

INCREASE (DECREASE) IN CASH                                                      73          (1,051)               (971)
CASH BALANCE - BEGINNING                                                         32           1,083               2,054
                                                                               -----          ------            -------
CASH BALANCE - ENDING                                                          $105             $32             $ 1,083
                                                                               =====            ====         ==========

SUPPLEMENTAL INFORMATION
Interest Paid                                                                $26,160          $3,740              $2,936
Taxes                                                                             --              --                  --

</TABLE>

The accompanying notes are an integral part of these statements.

                                      B-11

<PAGE>



                              EXOTECH INCORPORATED
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(1)      DISCUSSION OF OPERATIONS AND REALIZATION OF ASSETS

For the fiscal year ended June 30, 1996, the Company had an operating  profit of
$1,633.  The Company had an operating profit of $2,057 in the prior fiscal year.
At June 30, 1996,  approximately  $75,000 of accounts  payable were more than 30
days old.

The accompanying  financial statements have been prepared on the "going concern"
basis of generally accepted accounting principles. The ability of the Company to
continue normal  operations is dependent upon its ability to obtain the required
amounts of working  capital to finance the existing  contracts,  to continue the
acquisition of additional  contracts,  and to pursue  instrument sales at prices
sufficient to recover costs and some profits.  Management believes that improved
revenues now being  experienced  with the  Company's  new product  together with
stringent  control of costs and cash  outlays will  provide  sufficient  cash to
support its operations throughout the coming fiscal year.

Inventory of Crystallographic  Scanners have experienced no sales activity since
their  development  approximately  four years ago.  Efforts have  recently  been
intensified to develop a marketing  agreement  with an  established  marketer of
capital  equipment to the crystal growers and processors,  or  alternatively  to
sell the  products,  design  package,  software,  patents and licenses to larger
manufacturers  of instruments with a significant  presence in the  semiconductor
processing  equipment  market.  Should those  efforts  fail,  the company may be
forced  to charge  off the  carrying  value of  approximately  $243,000  against
income.

At June 30, 1996, the remaining value (backlog) of existing sales contracts were
approximately $279,000.

(2)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business
The Company is a manufacturer of  Electro-optical  instruments.  It performs the
research and development required for those products.

Principle of Consolidation
The accompanying  consolidated  financial statements include the accounts of the
Company and its subsidiary,  after  elimination of all significant  intercompany
transactions.

Revenue Accounting
The Company records revenue earned based on shipments of units of its products.

Inventory
Finished goods  inventory is stated on the basis of the lower of costs (average)
or market value.



                                      B-12

<PAGE>



Depreciation and Amortization
The Company uses a straight-line  method of depreciation  and  amortization  for
both tax and financial reporting purposes. The following time periods are used:

     DEPRECIATION:
                Laboratory equipment                      5 or 8 years
                Office furniture and equipment            5 years

     AMORTIZATION:
                Leasehold improvements                    Life of lease
                Patents                                   12 years

Depreciation  expenses recorded in the consolidated  statement of operations are
as  follows:  1994 -  $3,809,  1995 -  $2,454,  and  1996  -  $1,101,  including
amortization  of patents at the rate of $928 in each year.  The Company's  limit
for capitalization of property and equipment is $500 or more.

Income Taxes
Provisions  for  income  taxes  are  based on  pre-tax  income  reported  in the
financial statements, using the guidance of Financial Accounting Standards Board
Statement No. 109 (FAS #109) "Accounting for Income Taxes."  Differences between
income (loss) for financial  reporting purposes and tax reporting arise from (a)
the capitalization and amortization of research and development costs for income
tax  reporting  purposes,  but  deducting  these costs as expenses in the period
incurred  for  financial  statement  purposes;  and (b)  timing  differences  in
deducting  net losses on contracts.  There were no  provisions  for income taxes
required  in the three  year  period  ended June 30,  1996 due to the  operating
losses for each of those years.

At June 30, 1996, the Company had net operating loss  carryforwards  of $371,357
which  begin to expire in 1997.  The  Company  also has  incurred  research  and
experimental  expenses of $129,000 in 1996, and $54,368 in prior years that have
been  capitalized  to be  amortized  over a sixty  month  period  for income tax
purposes,  but have been expensed in the period incurred for financial statement
reporting.  While the  accounting  standard  allows  companies  to  recognize  a
deferred  tax asset on the tax effect of these timing  differences,  the Company
has provided a valuation  allowance  for the full amount since it is more likely
than not the deferred tax asset will not be realized.

The approximate tax effect of the carryforward  and temporary  difference for
the three years ended June 30 consist of:

                                             1996        1995          1994
                                           --------    --------      ------
Net operating loss carryforward           $148,543    $150,545      $119,923
Deferred research and
         experimental expenses              48,174       5,204         8,673
Less: Valuation allowance                 (196,717)   (155,749)     (128,596)
                                          ---------   ---------     ---------

Deferred Tax Asset - net                    - 0 -       - 0 -         - 0 -
                                          =========   =========     =======

Net increase in valuation allowance       $(40,968)   $(27,153)
                                          =========   =========



                                      B-13

<PAGE>



Following is a table  reconciling the Company's  accounting net loss for each of
the last three years ended June 30.
                                           1996         1995          1994
                                         --------     --------      ------
Accounting Net Loss                     $152,584      $68,130       $35,448
Nondeductible expense                                    (250)
Research and experimental costs:
    Capitalized on tax return           (129,000)         -             -
    Tax amortization                      21,574        8,674         9,874
                                        --------     --------      --------
Taxable Net Loss                        $ 45,158     $ 76,554      $ 45,322
                                        ========     ========      ========

Repairs and Betterments
Repairs are expensed as incurred. Betterments are capitalized and amortized over
the remaining useful life of the assets.

Accounts Receivable
Accounts receivable consist of amounts billed from sales as of June 30, 1996. In
the prior fiscal year an allowance for doubtful accounts was set up for $43,368.
This amount  represents a claim for product  development  costs from fiscal year
ended June 30,  1994.  This amount has since been  written  off, and there is no
allowance for doubtful  accounts as of June 30, 1996,  as the Company  considers
accounts receivable to be fully collectible.

Cash And Cash Equivalents
The Company  considers  all highly  liquid  debt  instruments  purchased  with a
maturity of three months or less to be cash equivalents.

Use of Estimates
In  preparing  financial   statements  in  conformity  with  generally  accepted
accounting principles,  management is required to make estimates and assumptions
that affect the reported  amounts of assets and  liabilities,  the disclosure of
contingent assets and liabilities at the date of the financial  statements,  and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from these estimates.

(3)      INVENTORY

Inventories are summarized as follows:
                                                     1996           1995
                                                     ----           ----

                Raw Materials                     $32,625       $ 32,625
                Goods in Process                  505,062        528,825
                Finished Goods                     14,000         14,000
                                                ---------      ---------
                                                 $551,687       $575,450

(4)      RESEARCH AND DEVELOPMENT COSTS

The Company's  accounting  policy is to write off research and development costs
as incurred.  In the fiscal year 1996,  $129,000 of R&D costs related to the new
Autoplate 4000 product were incurred and written off. There were no R&D costs in
the prior two years.


                                      B-14

<PAGE>



(5)      NOTES PAYABLE

Notes  payable at June 30,  1996,  consist of three  demand  notes of  $100,000,
$8,000 and $47,000  with  interest  at 8.5% per annum to three of the  Company's
former  directors.  In  addition,  Notes  amounting to $217,294 are payable with
interest at 8.5% per annum to one  officer/employee.  Periodically,  the Company
has  obtained  Producer  Loans  from  Spiral  Biotech,Inc.  that are  secured by
inventory instruments (bacteria colony counters) at a negotiated interest rate.

                                                            1996           1995
                                                            ----           ----

Average* aggregate amount outstanding during year       $352,712       $333,089
Maximum amount outstanding during year                   372,294        338,297
Average* interest rate on loans
outstanding at end of year                                 8.50%          8.48%
Average* interest rate incurred
during the period                                          8.50%          8.50%

*Average amounts  outstanding during the year and related average interest rates
were  determined  from the average of the  month-end  amounts  outstanding.  The
average  interest rate at each year-end was determined from the weighted average
of amounts outstanding at that time.

(6)      COMMITMENTS AND CONTINGENCIES

All  operations  of  the  Company  and  subsidiary   were  conducted  in  leased
facilities.  In March 1990,  the Company  entered into a lease  agreement  for a
three-year period for the present facilities at 8502 Dakota Drive, Gaithersburg,
MD. This lease was renegotiated  and extended for three years expiring  November
30, 1995 and was again extended for an additional three years effective December
1, 1995. The current lease expires November 30, 1998.

Non-Financing                              1999            1998            1997
                                          ------          ------          -----
Building                                 $13,220         $31,344         $30,431

(7)      EARNINGS PER SHARE

Per share  computations  were  based on the  weighted  average  number of shares
outstanding  during the periods,  excluding options because the market price and
option price were the same.


(8)      SUPPLEMENTAL PROFIT AND LOSS INFORMATION

         Description                             1996          1995       1994
         -----------                             ----          ----       ----

Taxes other than income:

         Payroll                               $9,588       $14,487    $18,307
         Franchise, Personal Property and
           other Miscellaneous                  1,137         2,681      1,528

         Rents, including equipment rental     40,097        39,823     38,488

                                      B-15

<PAGE>





(9)      DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

No disagreements  exist between management and its independent public accounting
firm.

(10)     TRANSACTIONS WITH SHAREHOLDERS

Sales to a company  owned by a  shareholder  aggregated  $340,841,  $335,736 and
$340,397,  (about 93, 91 and 78 percent,  respectively,  of total sales) for the
fiscal years ended June 30, 1996, 1995 and 1994, respectively.  Amounts due from
such sales at June 30,  1996 and 1995 were  $11,073 and  $10,932,  respectively.
Sales were  consummated on terms similar to those  prevailing with  unaffiliated
customers.

(11)     FAIR VALUES OF FINANCIAL INSTRUMENTS

The following methods and assumptions were used by the Company in estimating its
fair value disclosures for financial instruments:

         Cash, cash equivalents,  short-term  investments:  The carrying amounts
         reported in the  Consolidated  Balance Sheets  approximate  fair values
         because of the short maturities of the instruments.


                                      B-16

<PAGE>



                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
                  (a), (b), (e)

<TABLE>
<S> <C>
NAME:                                ROBERT G. LYLE (67)
                                     President,   CEO   of   the   Company   and
                                     subsidiary; Director.
Business experience
during past 5 years                  Same as above, since 1977.
Other Positions:                     None.
Other Directorships:                 None.

NAME:                                JAMES G. PAULI (41)
                                     Treasurer (1995-96) and Director and Member
                                     of Audit Committee (1992-96).
Business experience                  - Managing Consultant, Leader of Management Study Teams at during
past 5 years                         Electronic Data Systems, Inc., Herndon, VA Data Systems Consultants
                                     and Designers (1995-96).
                                     - Management Analyst, Price Waterhouse Audit and Management
                                     Consulting Firm (1990-95).
Other Positions:                     None.
Other Directorships:                 None.

NAME:                                ANDREW WONG (43)
                                     Secretary and Director (1996); Member of Audit Committee (1996).
Business experience                  - Vice President, Marketing, General Electric-Spacenet, McLean, during
past 5 years                         VA. Manager of Marketing Function for Telecommunications Division.
                                     Responsible for selling  customized private
                                     networks to businesses in the United States
                                     and  international  markets  (1995-96).
                                     - Director,   Business  Development,
                                     COMSAT Mobile   Communications, Bethesda,
                                     MD. Responsible  for  identification,
                                     analysis and   implementation   of  mobile
                                     wireless communications    business
                                     opportunities (1991-95).
Other Positions:                     None.
Other Directorships:                 Member, Board of Engineering Advisors, Univ. of California,
                                     Lawrence Livermore Laboratory (1995-96).

</TABLE>
--------------------
Note: All terms expire in December, 1997

c.    Not applicable.

d.    There are no family relationships between any of the above listed
      directors and any other director or executive officer of the Company.

f.    None of the  directors  or  executive  officers  have been  subject to any
      bankruptcy or insolvency proceedings, criminal proceedings, or injunctions
      against dealing in investments during the past three years.

                                      B-17

<PAGE>



ITEM 11.       MANAGEMENT REMUNERATION AND TRANSACTIONS

               A. No individual in management received  remuneration of $100,000
or more.  Officers as a group of three  people  received no payments  except for
$3,901 in disbursements for the group health and life insurance premiums for the
Chief Executive Officer.  The total compensation for the Chief Executive Officer
in fiscal year 1996 was $3,901.

               B. No annuity,  pension or retirement benefits are proposed to be
paid to any director or officer in the event of his retirement.  No remuneration
payments are proposed to be made in the future,  directly or indirectly,  to any
director or officer by the Company or its  subsidiary  pursuant to any  existing
plan or arrangement.

               C.     There are no fees paid to directors for services in that
capacity.

               D. No officer,  or director of the Company:  (1) received options
during the  reporting  period;  or (2)  exercised  options  during the reporting
period,  or (3) held options as of September 1, 1996. The officers and directors
of the Company as a group did not:  (1)  receive  options  during the  reporting
period, or (2) exercise options during the reporting period, or (3) hold options
as of September 1, 1996.

               E.     Termination of employment - the Company has no employment
termination agreements with officers or employees.


                                      B-18

<PAGE>



                                    PART IV

ITEM 14.   EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON
           FORM 8-K

A.  1.  LIST OF FINANCIAL STATEMENTS IN PART II OF THIS REPORT.
                                                                    PAGE NO.

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS..................  10-11
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THREE YEARS
 ENDED JUNE 30, 1996................................................  12
CONSOLIDATED BALANCE SHEETS - JUNE 30, 1996 AND 1995................  13-14
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE
 YEARS ENDED JUNE 30, 1996..........................................  15
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS'
 INVESTMENT - FOR THE THREE YEARS ENDED JUNE 30, 1996...............  16
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS..........................  17-22
FINANCIAL DATA SCHEDULE.............................................  25

Schedules other than those listed above are omitted for the reason that they are
not required or are not applicable,  or the required information is shown in the
financial statements or notes thereto.

Columns  omitted from schedules  filed have been omitted because the information
is not applicable.

Individual  financial  statements  of the  Company  are  omitted  because  it is
primarily an operating  company and the subsidiary  included in the consolidated
financial  statements being filed in the aggregate does not have minority equity
interests and/or indebtedness to any person other than the parent in the amounts
which  together  exceed 5% of the total  consolidated  assets at the date of the
latest  balance  sheet filed  excepting  indebtedness  incurred in the  ordinary
course of business which is not overdue and which matures within one year of its
creation,  whether  evidenced by  securities or not, and  indebtedness  which is
collateralized by the parent by guarantee, pledge, assignment or otherwise.

A.      2.     PARENT AND SUBSIDIARY

         The Company has no parent. The subsidiary of the Company is:

                  NAME:   EXOTECH RESEARCH & ANALYSIS, INC.

                  STATE OF INCORPORATION:   DELAWARE

                  SECURITIES OWNED BY THE COMPANY:   COMMON STOCK, 100%

         The foregoing is included in the consolidated statements of the Company
and subsidiary.

                                      B-19

<PAGE>



A.  3.  EXHIBITS

3.1  Restated  Certificate  of  Incorporation  of the  Company  which is  hereby
identified as a BASIC DOCUMENT.  The document was originally filed pursuant to a
Registration Statement (Form S-1) filed on November 8, 1968, and is incorporated
herein by reference.

3.2 By-Laws of the Company as revised amended on April 16, 1971, which is hereby
identified  as a BASIC  DOCUMENT.  The document has been filed  pursuant to FORM
10-K for the fiscal  year ended June 30,  1971,  and is  incorporated  herein by
reference.

3.3 Specimen copy of a certificate  for the  Company's  common stock,  par value
$.10 per share, which is hereby identified as a BASIC DOCUMENT. The specimen was
filed pursuant to a Registration Statement (form S-1) filed on November 8, 1968,
and is incorporated herein by reference.

3.3(a) Specimen copy of a certificate for the Company's  common stock, par value
$.10 per share, reprinted due to exhaustion of the initial supply. This specimen
copy was identified as a BASIC DOCUMENT.  This exhibit was filed with Form 8 for
the fiscal year ended June 30, 1975, and is incorporated herein by reference.

3.4 CERTIFICATE OF AMENDMENT OF CERTIFICATE OF INCORPORATION - EXOTECH
SYSTEMS, INC. changing its name to EXOTECH RESEARCH AND ANALYSIS, INC. certified
by the Secretary of the State of Delaware on the 12th day of August 1975, which
is identified as a BASIC DOCUMENT. The document was originally filed with the
Form 10-K for the fiscal year ended June 30, 1976, and is incorporated herein by
reference.

3.5 CERTIFICATE OF OWNERSHIP AND MERGER merging EXO-REALTY, INC. into EXOTECH
INCORPORATED, certified by the Secretary of State, State of Delaware on the 28th
day of June,  1976,  which is identified as a BASIC  DOCUMENT.  The document was
originally filed with the Form 10-K for the fiscal year ended June 30, 1976, and
is incorporated herein by reference.


B.  No Form 8-K reports were filed in the fiscal year covered in this report.


                                      B-20

<PAGE>



                                   SIGNATURE


Pursuant to the  requirements  of Section 13 or 15 (d) of the  Securities Act of
1934, the Company has duly caused this amended Report to be signed on its behalf
by the undersigned, thereunto duly authorized.





  February 26, 1997             BY:        /s/ Robert G. Lyle
-------------------------          --------------------------------
         DATE                        ROBERT G. LYLE, CHIEF EXECUTIVE OFFICER,
                                     PRINCIPAL ACCOUNTING OFFICER AND DIRECTOR




  February 26, 1997             BY:        /s/ James G. Pauli
------------------------            --------------------------------
         DATE                        JAMES G. PAULI, TREASURER (PRINCIPAL
                                     FINANCIAL OFFICER) AND DIRECTOR




  February 26, 1997             BY:        /s/ Andrew Wong
------------------------            --------------------------------
         DATE                        ANDREW WONG, SECRETARY AND DIRECTOR




                                      B-21